In Montgomery County, 1 in 5 live in poverty

Unemployment numbers improve, but wages are falling, leading to declines in income

Poverty is worse now in Ohio and the Miami Valley than at the beginning of the Great Recession.

Poverty rates have continued to climb, according to newly released Census data, even as unemployment rates have plummeted and politicians tout the state’s economic recovery.

In Montgomery County, nearly one in five people, 19.6 percent, were living below the poverty line in 2014, according to the data. That’s about the same as the previous year, but a significant increase from 14.6 percent in 2007, the year the Great Recession began.

Meanwhile, the county’s unemployment rate has fallen from a high of 13.2 percent in January 2010 to 4.8 percent by the end of last year.

How could so many people — an estimated 1.8 million Ohioans and more than 220,000 in the Miami Valley — still be in poverty if the economy is recovering?

The answer, experts say, is that even though employment has rebounded, wages have fallen.

“What I saw at the state and the national level was that people are working and working hard,” said Hannah Halbert, workforce researcher and poverty expert at the left-leaning Policy Matters Ohio.

“So employment had increased … in a significant way, but that wasn’t getting translated into actual income gains or reduction of poverty.”

Statewide, median household income had declined in 2014 by almost $3,900, or 7.3 percent, since the beginning of the recession, the data show.

And the median household income for Montgomery County had fallen even more — about $7,500 since 2007.

Part of the reason wages haven’t risen while the unemployment rate has fallen is that a lot of people still want jobs, even if they’ve stopped actively looking, said Greg Lawson, policy analyst for the conservative Buckeye Institute.

The unemployment rate, he said, isn’t as significant as the labor force participation rate — the share of working-age people who are at work or looking for a job. That number has fallen in the state, and has not recovered.

When people stop looking for jobs, they’re no longer considered in the labor force and are left out of calculations for the unemployment rate.

Ohio, Lawson pointed out, lost more jobs between 2000 and 2010 than any state except Michigan.

“We haven’t recovered all those jobs, and we have a loose labor market that’s not creating the demand for higher wages,” he said. “So all of that is playing a role in the decline in median income, and obviously that’s going to play some role in some of the issues with the increases in the poverty rates.”

‘One disaster away’

Experts say one cause of the high poverty rate is that higher-paying, full-time jobs are being replaced with jobs that don’t pay a living wage, or jobs that are part-time or temporary.

“We really feel that this is a crisis that has evolved from a shift in how our economy is working,” said Joree Novotny, spokeswoman for the Ohio Association of Foodbanks.

“I think the key is jobs, and those jobs have to pay better wages,” said Tina Patterson, chief executive at Homefull, a Dayton-based nonprofit that assists the homeless.

“People are now underemployed,” Patterson said. “(People) are literally living from paycheck to paycheck, and that paycheck is now considered poverty line. It’s kind of now one disaster away from the whole bottom falling out for people.”

The current poverty threshold is $24,250 for a family of four.

Wonnie Montague, of Dayton, said she never thought she’d need help from a food pantry.

“I’ve always had a real good job,” said Montague, 46. “But you just never know what could happen to you.”

In Montague’s case, she injured her knee and could no longer work as a truck driver. So she went on workers’ compensation and took a “light-duty” job at the Choice Food Pantry, which is operated by Catholic Social Services on West Riverview Avenue in Dayton.

She said she’s also had to visit the pantry as a client.

Like many people, she was making too much to get food stamps or other benefits, but she wasn’t getting enough in her reduced paycheck to make it last for her and a 6-year-old grandniece, of whom she has custody.

“So you kind of fall in between where you’re doing too much for one place and not enough for another place,” she said. “I guess, to me, I felt like it’s not above the poverty level. And then you end up here, where they’re willing to help you.”

Catholic Social Services of the Miami Valley made over 18,000 food distributions to households last year, up 40 percent since 2008, said Laura Roesch, the nonprofit’s chief executive.

She said the number of first-time visitors to the pantry reflects the jarring transformation in the local job market.

“These are folks who were never expecting to be receiving assistance coming to us in large numbers,” said Roesch. “These are folks that had good, stable manufacturing jobs, the kinds of jobs that were lost in our community.”

It’s not always easy for people to visit the pantry, either.

Montague, who works at the pantry as a receptionist and shopper’s aide, said she’s often had friends see her working and turn away in embarrassment.

“I’ll call them on the phone and say, ‘You need to come back because you were here for a reason, you know? Don’t be shy because you looked up and saw me, because I’ve been right through this line a couple times myself. This is going to help you.’ ”

‘Wake-up call’

“It’s a wake-up call for all of us, that’s for sure,” said former U.S. Rep. Tony Hall, executive director emeritus of The Hunger Alliance. “We’ve lost a lot of great jobs. There’s a lot of working women with children, a lot of senior citizens on fixed incomes just living on Social Security. They’re not making it.”

Hall, a Democrat who represented Dayton in Congress for more than two decades, has returned to the area to head up the Hall Hunger Initiative in an effort to unite local governments, businesses, universities, the faith community, health care providers and nonprofits to overcome the problem of hunger.

“This poverty is not just in Dayton, Ohio,” Hall said. “It’s starting to creep into the suburbs. It’s a problem that we really need to address and we need to bring everybody into the room to address it.”

Greene County, for example, saw an even greater poverty rate increase than Montgomery County since 2007, according to this newspaper’s analysis of the American Community Survey data released last week.

The suburban and rural county of about 161,000 saw its poverty rate shoot up by 5.1 percentage points since the recession began, from 8.8 percent in 2007 to 13.9 percent last year. An estimated 21,540 Greene County residents were living in poverty last year.

Three of the other four local counties large enough to be included in the survey (Butler, Clark and Miami) also had higher poverty rates in the latest data, but the increases were not large enough to be statistically significant.

Only Warren County showed a slight decrease from 2007 — less than 1 percent — but that was well within the survey’s margin of error.

Ohio’s poverty rate was up significantly during the period, from 13.4 percent in 2007 to 15.8 percent last year.

More working poor

The state was also sixth-worst in the country in food insecurity last year, said Novotny, of the state foodbank group. Almost 17 percent of Ohio’s households couldn’t afford adequate nutritious food, she said.

“We know that hunger is a symptom of poverty,” Novotny said. “We are really concerned about the continued high rates.”

Low-income residents can get food stamps, but the program is designed to only supplement a family’s food supply. Novotny said half of the Ohioans on food stamps who use food pantries report they exhausted their benefits within two weeks, and 85 percent within three weeks.

The 96 food programs in Montgomery County served 35,992 people in July, said Michelle Riley, chief executive of the Foodbank, which serves Montgomery, Greene and Preble counties.

She said it used to be uncommon to find the working poor waiting in food pantry lines, but not anymore.

Novotny said about half of the people who use food pantries in Ohio have jobs.

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“They’re playing by the rules, they’re doing everything they can,” Hall said. “It’s just not enough.”

Phil Parker, president and chief executive of the Dayton Area Chamber of Commerce, said the poverty figures are indeed driven partly by the loss of higher-wage jobs as the auto industry declined in Ohio and the region.

But he also said there is a gap between what businesses need and the education and skills of potential workers. More and better education, he said, would help the local poverty rate.

“There are many jobs that have gone unfilled because we don’t have the skill sets,” Parker said.

He said companies must remain competitive to stay in businesses, and that means they need to hold down their costs — including wages — and invest in technology and innovation.

“Would you rather have a company that was profitable or one that would go bankrupt?” Parker said.

People have a responsibility to make themselves employable, he said, and the region has a number of public universities and community colleges that are affordable.

“It is vital that they invest in themselves so that they are not restricted to part-time jobs or those jobs that won’t give them the career and the income levels that they want,” Parker said.

Search for solutions

Roesch, of Catholic Social Services, said poverty is complex and addressing it requires attention to education, health care, housing, employment and relationship issues. Both Catholic Social Services, which is privately funded, and the taxpayer-funded Montgomery County Job and Family Services try to wrap clients in a variety of resources to address those complexities.

For example, JFS offers job coaching and training, along with financial assistance, said Tom Kelley, assistant Montgomery County administrator.

Last year, 384 people were provided with funding through the department’s workforce division and as a result 82 percent reported that they found jobs, said JFS spokesman Kevin Lavoie.

Halbert, of Policy Matters Ohio, said state policies need to change.

She backs raising the minimum wage, supporting collective bargaining rights and more infrastructure spending to help bolster wages, put people to work and rebuild aging roads and bridges.

Increasing poverty has expanded income inequality, she said, and that sends ripples through the economy. Businesses, she said, need to pay attention.

“You know, one person’s worker is another person’s customer,” Halbert said. “Folks need customers. So if you’re a corner store, you have to have someone coming in and buying your goods and services.”

Poverty seems like a “big, abstract thing” to a lot of people, Halbert said. It’s something that happens to other people who make bad choices. But poverty is bad for everyone, she said.

A study released last October by the Federal Reserve Bank of St. Louis found that rising income inequality, which is exacerbated by increasing poverty rates, is a factor in slowing the nation’s recovery from the Great Recession.

“The reality is that lots of people find themselves below the poverty line for a lot of different reasons over the course of their lives,” Halbert said. “This stuff isn’t isolated, and it does have an impact on our communities and it does have an impact on our economy.”

Lawson said the Buckeye Institute, which he describes as a “free-market think tank,” agrees with none of those solutions.

The big danger from increasing poverty, Lawson said, is it increases the pressure for more government spending.

“Increasing the minimum wage, and things of that nature, are very popular when you see those kind of poverty numbers,” he said. “But we think they are detrimental, and will actually make things worse for a large number of people.”

The institute calls for more tax reform, at the state and the local levels, and regulation reform to help small businesses get started. Getting more businesses started, Lawson said, will help boost gains in employment and in wages over time.

Everyone agrees that more jobs are the answer, he said. The question is: How do we get them?

“I think everybody should be concerned about these numbers because they show that Ohio has seen some level of improvement since the Great Recession,” Lawson said. “But that we should be under no illusion that it’s all sunny and everything else.

“There’s a lot more work that needs to be done, and we should have robust debate as to how to get there.”